The Hong Kong SAR government announced on December 13 that it has committed to implementing a reporting framework for crypto assets (the reporting framework) to enhance international tax transparency and combat cross-border tax evasion, as stated to the OECD Global Forum on Tax Transparency and Exchange of Information.
Given the rapid development of the crypto asset market, the OECD published the reporting framework in June 2023 to ensure global tax transparency is maintained. As an extension of the current 'Common Reporting Standard for Automatic Exchange of Financial Account Information', the reporting framework establishes a similar mechanism for tax residents who are users or controllers of crypto assets to automatically exchange tax information related to crypto asset accounts and transactions annually with their tax jurisdictions.
To ensure that the reporting framework can be implemented fairly and effectively on a global scale, the Global Forum has invited all relevant stakeholders in the crypto asset industry, as well as those identified as directly relevant tax jurisdictions (including Hong Kong), to implement the reporting framework.
Hong Kong is committed to implementing a reporting framework with suitable partners on a reciprocal basis, and the relevant partners must meet the standards for ensuring the confidentiality and security of information. In view of the latest timetable set by the global forum, the government plans to complete the necessary local legislative amendments by 2026 or earlier, and to start the first automatic exchange of information with relevant tax jurisdictions under the reporting framework in 2028.
Xu Zhengyu added: The government will listen to the opinions of relevant stakeholders and the public when preparing the necessary legislative amendments.
(Source: Hong Kong Government News Website)